But following widespread outrage and debate, Prime Minster Scott Morrison now says any changes to the law will protect LGBTI students. Opposition Leader Bill Shorten agrees with him.

Now, the principals of 34 Anglican schools in New South Wales have written to our federal politicians asking them to protect the legal exemptions that allow them to sack gay teachers.

In an open letter to all the MPs in Australia, the heads of school argue there is "no effective protection" under Australian law that "guarantees" religious freedom.

The second half of the letter.

They claim the changes to the law are not designed to discriminate, but to protect their organisation's core values.

"The debate has been polemicised as the right to expel gay students, with little evidence that this occurs, and the right to dismiss gay staff members, again with very little evidence that this occurs," the letter states

"The current exemptions ... in the Sex Discrimination Act are really the only significant legal protections available to schools to maintain their ethos and values with regard to core issues of faith," it said.

The list of schools and principals who don't want anti-discrimination laws changed to protect LGBT teachers and students from being excluded.

TheAnglican Church Diocese of Sydney's letter says it's about employing staff who reflect the ethos of the school.

"By and large across faith-based schools, the issue at hand is the right to employ staff who support the ethos of the school. This is not inconsistent with the practice of most employers and their corporate goals, let alone political parties," the letter said.

"It is essential that a teacher supports the values, ethos and mission of the school as much as he or she can. It is not appropriate, for example, for a teacher to undermine or denigrate the beliefs and teaching of an employing school."

The principals of numerous elite Sydney private schools including the King's School in Parramatta, Barker College and Abbotsleigh in the northern suburbs, Shore in North Sydney and Trinity Grammar School in the inner west have signed the letter.

Members of the LGBTI community who attended many of these schools have expressed sadness and outrage about the letter on social media.

Given how many Anglican institutions—many of them schools—were raised in the Royal Commission as having a “do nothing” approach to child sex abuse, the temerity of taking action on this borders on the breathtaking. https://t.co/g0YNPxMeiQ

Education Minister Dan Tehan said the message from the Anglican principals is part of a "very important discussion" about competing rights.

"Obviously the UN declaration of human rights has freedom of religion as one of it's core rights, but we also want to protect against sexual discrimination," Mr Tehan told Sky News on Wednesday.

Mr Tehan says he is confident Attorney-General Christian Porter, who is working on the government's response to the review, will address the issue.

"I've got great confidence that the attorney-general will get the balance right when it comes to these competing rights," Mr Tehan said.

It was widely expected the draft laws would be introduced to Parliament this week, but talks between the two parties are continuing.

Mr Porter will make recommendations to Cabinet and is currently speaking with shadow attorney-general Mark Dreyfus, he said.

"They were close to a resolution when Parliament last sat but they didn't quite get there, so those discussions will continue."

FULL LIST OF PRINCIPALS WHO SIGNED THE LETTER

Megan Krimmer: Headmistress at Abbotsleigh

Graham Anderson: Principal at Arden Anglican School

Gareth Leechman: Principal at Arndell Anglican School

Phillip Heath: Headmaster at Barker College

Megan Hastie: Acting Head at Blue Mountains Grammar School

Don O'Connor: Headmaster at Broughton Anglican College

Douglas Thomas: Principal at Claremont College

Maryanne David: Headmistress at Daneback Anglican School

David Nockles: Headmaster at Macarthur Anglican School

Craig Mansour: Headmaster at Macquarie Anglican Grammar School

Cathie Graydon: Principal at Mamre Anglican School

Julie Greenhalgh: Principal at Meriden School

Garry Brown: Headmaster at Mosman Prep School

Lorrae Sampson: Principal at Nowra Anglican College

Naomi Wilkins: Principal at Oran Park Anglican College

Rev Louis Stringer: Headmaster at Orange Anglican Grammar School

Felicity Grima: Acting Head at Penrith Anglican College

Paul Cockrem: Principal at Richard Johnson Anglican School

Deb Magill: Principal at Roseville College

Peter Fowler: Principal at Rouse Hill Anglican College

Anthony Cummings: Principal at Shellharbour Anglican College

John Collier: Head of School at St Andrew's Cathedral School

Julie Townsend: Headmistress at St Catherine's School

Jann Robinson: Principal at Luke's Grammar School

Brendan Gorman: Headmaster at St Peter's Anglican Primary School

Tim Wright: Headmaster at Sydney Church of England Grammar School (Shore)

Susan Middlebrook: Principal of Tara Anglican School for Girls

Tony George: Headmaster at The King's School

Ross Whelan: Principal at Thomas Hassall Anglican College

Gaynor MacKinnon: Principal at Trades Norwest Anglican Senior College

Tim Bowden: Headmaster at Trinity Grammar School

Judith Nealy: Head of The Illawarra Grammar School

Scott Marsh: Headmaster at William Clarke College

Stuart Quarmby: Headmaster at Wollondilly Anglican College

This is the full list of NSW schools who approve of discrimination against LGBTI+ students and teachers. They have asked the prime minister to grant them their right to fire gay teachers and expel gay students. -@JordanRaskoI was a student at Shellharbour Anglican. Heartbroken. pic.twitter.com/WiJhAgtVUr